Case Information
*1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA JACK STONE, Case No. 21-cv-02090-DMR Plaintiff, ORDER TO SHOW CAUSE v.
POPOUT INC., et al.,
Defendants.
Pro se Plaintiff Jack Stone filed a complaint and an application for leave to proceed in
forma pauperis (“IFP”) on March 23, 2021. [Docket Nos. 1, 3.] On March 26, 2021, the court granted Plaintiff’s IFP application and noted that it would determine separately whether the complaint should be served. [Docket No. 8.] Having reviewed the complaint, it appears that the court lacks subject matter jurisdiction over this action. Plaintiff alleges that he contracted with Defendant Popout, Inc. dba Shippo (“Shippo”) “to ship a surfboard and relevant accessories to Plaintiff’s residence in Sendai, Japan,”
and that Shippo was acting as an agent for Defendant DHL Freight USA, Inc. (“DHL”). Compl. ¶
1. He further alleges that in December 2020, a third party delivered the surfboard and accessories
to him in “badly damaged” condition, with the surfboard “destroyed . . . beyond repair.” . at ¶¶
9, 11. Defendants have failed to process Plaintiff’s damages claims and refused to reimburse
Plaintiff for his damages. See generally Compl He alleges that he paid a total of $889.94 for the
surfboard and accessories and $261.32 in shipping costs, and that Shippo also charged an
“unauthorized fee” of $129.00 related to postage. Compl. ¶¶ 4, 6, 15. He appears to bring claims
for breach of contract, negligence, and fraudulent misrepresentation. Compl. 2 § C.
Federal courts are courts of limited jurisdiction, and a “federal court is presumed to lack jurisdiction in a particular case unless the contrary affirmatively appears.” Stock W., Inc. v.
*2 Confederated Tribes , 873 F.2d 1221, 1225 (9th Cir. 1989) (citations omitted). A federal court
may exercise either federal question jurisdiction or diversity jurisdiction. Here, Plaintiff appears
to assert state law claims; therefore, Plaintiff may only proceed in federal court if he establishes
diversity jurisdiction.
Plaintiff avers that this case fulfills the diversity jurisdiction requirements. Compl. 2.
A district court has diversity jurisdiction where the parties are diverse and “the matter in
controversy exceeds the sum or value of $75,000, exclusive of interests and costs.” 28 U.S.C. §
1332. In relevant part, 28 U.S.C. § 1332 provides that parties are diverse when they are “citizens
of different States” or “citizens of a State and citizens or subjects of a foreign state.” 28 U.S.C. §
1332(a)(1), (2). Parties are diverse only when “the citizenship of each plaintiff is diverse from the
citizenship of each defendant.” Caterpillar Inc. v. Lewis , 519 U.S. 61, 62 (1996). “[T]he
congressional grant of diversity jurisdiction is to be strictly construed.” Kantor v. Wellesley Galleries, Ltd. , 704 F.2d 1088, 1092 (9th Cir. 1983). Plaintiff claims that he is a resident of Japan, that Shippo is headquartered in San Francisco, and that DHL does business in San Francisco, California. Compl. 2. Based on these allegations, it is not clear whether the parties are diverse, as Plaintiff does not allege his own citizenship or the citizenship of either defendant. To the extent Plaintiff claims jurisdiction is proper under 28 U.S.C. § 1332(a)(1), he must allege that the parties are “citizens of different
States.” As to Defendants, “a corporation is deemed a citizen of any state where it is
incorporated and the state where it has its principal place of business.” Co-Efficient Energy Sys. v.
CSL Indus., Inc. , 812 F.2d 556, 557 (9th Cir. 1987) (citing 28 U.S.C. § 1332(c)). Thus, it appears
that Shippo may be a citizen of California, since it is headquartered in this state. However, the
complaint does not allege facts regarding DHL’s citizenship. “Absent unusual circumstances, a
party seeking to invoke diversity jurisdiction should be able to allege affirmatively the actual
citizenship of the relevant parties.” Kanter v. Warner-Lambert Co. , 265 F.3d 853, 857 (9th Cir.
2001).
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As to Plaintiff, citizenship is determined based on his United States citizenship and his 27
domicile. Kantor , 704 F.2d at 1090. “In order to be a citizen of a State within the meaning of the
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*3 diversity statute, a natural person must both be a citizen of the United States and be domiciled
within the State.” Newman-Green, Inc. v. Alfonzo-Larrain , 490 U.S. 826, 828 (1989) (emphasis in
original). “A person’s domicile is her permanent home, where she resides with the intention to
remain or to which she intends to return.” Kanter , 265 F.3d at 857. Here, the complaint alleges
only that Plaintiff resides in Japan; it does not allege that Plaintiff is a citizen of the United States
or that he is domiciled within a state. Therefore, it does not sufficiently allege that he is a citizen
of a state for purposes of 28 U.S.C. § 1332(a)(1). Louisiana Mun. Police Employees’ Ret. Sys.
v. Wynn , 829 F.3d 1048, 1056 (9th Cir. 2016) (holding United States citizen who was a permanent
resident of Macau “cannot be a citizen of a State for purposes of diversity jurisdiction” because
she was not domiciled in a state).
To the extent that Plaintiff relies on 28 U.S.C. § 1332(a)(2), that subsection requires an action to be between “citizens of a State and citizens or subjects of a foreign state.” However, the complaint does not allege facts to support diversity jurisdiction under that subsection, as it does not allege that any party is a “citizen[ ] or subject of a foreign state.” Moreover, Section 1332(a)(2) does not apply if Plaintiff is a United States citizen, since at least one defendant (Shippo) appears to be an American citizen. Louisiana Mun. Police Employees’ Ret. Sys. , 829 F.3d at 1056 (holding that “jurisdiction cannot be grounded in § 1332(a)(2)” where “there are American citizens on both sides of the case”).
Additionally, Plaintiff alleges that the amount in controversy in this case is $75,000.01.
Compl. 2. However, Plaintiff’s DHL damages claim, which is attached to the complaint, seeks
only the sum of $724.94. . at ¶ 32, Ex. G. To the extent that Plaintiff seeks reimbursement for
the purchase price of the surfboard and accessories in addition to all of the shipping charges he
incurred, the total potential damages appears to be $1,280.26, far below the $75,000 minimum
required to establish diversity jurisdiction. The complaint contains no allegations supporting
Plaintiff’s claim that the amount in controversy is actually $75,000.01.
Therefore, by no later than May 26, 2021, Plaintiff shall show cause in writing why this matter should not be dismissed for lack of subject matter jurisdiction. If Plaintiff does not file a U N I T E D S T A T E S D I S T R I C T C O U R T N O R T H E R N D I S T R I C T O F C A L I F O R N I I T I S S O O R D E R E D J u d g e D o nn a M R y timely response to this Order to Show Cause, the court will recommend that the action be *4 dismissed.
The court refers Plaintiff to the section “Representing Yourself” on the court’s website, located at http://cand.uscourts.gov/proselitigants, as well as the Court’s Legal Help Center for
unrepresented parties. The Legal Help Center may be reached by phone at (415)782-8982.
IT IS SO ORDERED.
Dated: May 12, 2021
______________________________________ Donna M. Ryu United States Magistrate Judge